Thursday, July 15, 2010

Chris Klaus spoke this evening at the Georgia Tech College of Computing building that bears his name. Klaus made his fortune as founder and former CTO of Internet Security Systems, a company he started while still a Tech student in 1990. He has stepped down as CTO, and is the CEO and founder of Kaneva, a 3-D virtual world.

His talk focused on trends in gaming, advice about technology start-ups, and bringing the gaming industry to Georgia. A lot of people were interested in what he had to say. There was a sizable crowd, and before and after the talk there was time for networking. This was the lowest female to male ratio I've experienced in a long time, and that's saying a lot at Tech. That could be because there were so many Tech alumni there, and in earlier years the ratio was even less balanced than now. The majority, though not all, of the attendees were Tech affiliated, so I got plenty of chances to respond, "No, I'm a Tech alum" when people asked if I was a Tech student. The novelty hasn't worn off yet.

It was really cool to be able to converse about some of my research interests with people who are knowledgeable about related topics and have come by their expertise in different ways. The people I met were not in academia, but mostly worked in the private sector or had their own business or non-profit. It was a great way to close my last day of work at CACP, because in talking with so many people, I got a better picture of just how much I have learned both through CACP and through earlier experiences. I can finally talk about my background and interests with some degree of coherence because I can finally see some degree of coherence.

The speech emphasized several themes and trends that are garnering lots of attention lately. For virtual worlds he mentioned scalability and simulation capacity. He provided a useful phrase, augmented reality, to describe a trend, being facilitated by wireless mobile devices, of the real and the virtual increasingly interacting. Examples he gave were MyTown, Zillo, and geotagged games. He also used the word freemium to describe games and software that is offered free, with charges for upgrades. This is the business model he foresees having growing success, associated with the trend moving from value in content to value in aggregation. And of course, the really big deal trends are user generated content (so big it gets an acronym, UGC) and crowdsourcing (so big they had to make up a word for it).

None of these trends were new to me, but what was new was hearing them described in unabashed relation to earning lots and lots of money. At work, I do consider how virtual worlds and online gaming can improve employment, expand the economy, or earn people a living, but it never even crossed my mind to wonder how I could earn money by them. That is probably a useful exercise. I love to theorize about the economy in the abstract, but am quite out of touch with actual money and business. Klaus talked about using venture capital, angel investors, and technology incubators, all of which I understand in theory, but I wouldn't know the first thing about actually approaching them with an actual business plan. Do you just google search for venture capitalists and call them up?

Klaus gave a list of metrics that venture capitalists pay attention to when deciding if they will invest in your tech start-up. These include acquisition (getting people to your site), activation (getting people to sign up), referral (getting people to tell their friends), retention (getting people to come back), and revenue (getting paid).

He mentioned a techie news site he likes, Techmeme, which is a prime example of the "gatewatching" trend I mentioned in a previous post. Klaus also mentioned the Glitch program, run by Georgia Tech and Morehouse College, that brings in high school students to test video games and get excited about computer science over the summer. And finally, it was highly amusing when someone during the Q&A asked Klaus if he had heard of Second Life (Kaneva's biggest competitor).

Media organisations would have the exclusive right, for a predetermined period, to publish their material online. The draft also considers curtailing fair use, the legal principle that allows search engines to reproduce headlines and links, so long as the use is selective and transformative (as with a list of search results). Jeff Jarvis, who teaches journalism students to become entrepreneurs at New York’s City University, says this sounds like an attempt to protect newspapers more than journalism.

Why do news corporations merit such protection? I understand the Econ 101 explanation for copyright laws (and wrote a cringeworthy paper on the subject in high school). It boils down to incentivizing production of intangibles by lending them some of the properties of tangibles (i.e. excludability) to address some of the causes of market failure (i.e. freeriding).

Copyright laws, like any other laws, restrict the freedom of society, and therefore can only be justified if they also protect society. That was the original intent of copyright law-- to protect society from the underproduction of socially beneficial works. The Copyright Clause in the U.S. Constitution authorizes Congress "To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries." So the purpose was promoting science and useful arts, while the method was granting exclusive rights. But the rhetoric has changed. What was once the method is taken for the purpose. For example, Ayn Rand advocates copyrights as protecting "a man’s right to the product of his mind" (rather than a society's right to progress). And what about these newspaper "protections" being considered? Are they protecting society from harmful underproduction?

First, let me note some distinctions to bear in mind. There are products associated with news, but news is not a product. News itself--what happens in the world--is the story of humanity and is not subject to markets, nor, a fortiori, to market failure. Newspapers and newspaper delivery, for instance are products (the first a good, the second a service). More generally, communication of the news is a product, often entailing a combination of goods and services. Underproduced communication of the news would indeed be a social harm.

Communicating the news once required access to a printing press and physical delivery of newspapers. A journalist alone could not very practically communicate the news, given the high capital requirements and distribution costs. News corporations formed out of practical necessity, and coordinated the efforts of journalists, editors, photographers, printers, etc. to produce a periodical that could then be mass delivered. Physical limitations on communicative materials also required the news media to play a gatekeeping role, determining what news was fit to print in the limited space and also maintaining some semblance of credibility. So communicating the news required corporations, and corporations require incentives.

But now, a journalist (or anyone with knowledge of a news occurrence) does have a practical way of communicating the news. The capital requirements for communication are drastically different with the Internet. The coordinating role played by news corporations is no longer as necessary. Many functions of traditional news corporations can be crowdsourced now that traditional barriers to collaboration such as time and geography have been overcome. The need for mass media brands to signal credibility is reduced now that authors can easily link to other articles, multimedia, and primary sources, and people can comment directly on articles and discuss dubious claims, and even award reputation points. Plus the general public is better equipped to check credibility for themselves (as I did, for example, by finding FTC documents after reading the first news article), especially as digital literacy rises.

Lower news communication costs, by challenging mass media hegemony, have enabled niche news production. This actually increases news coverage for everyone, and additionally can bring hope of social justice to sparse populations or interest groups who have traditionally been ignored by the mass media. The example I have in mind is people with rare types of disabilities. In place of gatekeeping, a number of sites have taken to gatewatching, helping audiences navigate the vastness of news channels. Gatewatchers publicize, rather than publish, news, by providing headlines, summaries, and links to stories they deem relevant or noteworthy. Gatewatching also occurs when we "like" or "digg" articles, link to them in our blogs, and share them on our social networking sites (like when Daniel called my attention to the article on copyrighting).

In another age, government intervention via copyright law did mitigate underproduction of news communication. But the proposed strengthening of copyright laws is unneccessary, as news communication is at no risk of being underproduced. In fact, if the government is going to intervene, better to do so by increasing broadband access than by propping up newspaper corporations.

Saturday, July 3, 2010

There are two types of friends-- those that tell you the truth, and those that tell you what you want to hear. The latter are enjoyable to be around, but in the long run are probably not so good for you.

You can learn a lot about society from its conceptual metaphors, and they are more influential than you might think. The common expression that numbers don't lie not only personifies data, it characterizes data as that first type of friend, the rare kind that tells it to you straight. Many a college admissions essay, my own included, are essentially an eager theme-and-variations on that sentiment. With my wordy ode to empiricism, I got into college and learned all about data, got to know numbers really well, only to discover that maybe they're not exactly what I thought.

At work I have the onerous task of trying to determine the number of jobs that can be attributed to digital technology, and to analyze the trends and the potential for future employment in the information economy. So lately I've been deep in the databases of the Census, BLS (OES, CES, BDM, CPS etc.), BEA, OECD, even AARP. I've fought the good fight with Excel.

The result? Whatever you want to hear. I can't post the graphs up here, but widely disparate trends and figures can come out of some straightforward analysis. As an exercise, go to BLS and use the data to justify that digital media-related employment is growing. And then use the data to justify that it is in decline. Anything I want to tell you, I can tell you, and back up with statistics and a graph. The problem is, I don't know what I want to tell you. I want the data to tell me what is true!

I know the surface-level explanations. Sometimes data collection is shoddy. Sometimes metrics are poorly designed, methods are lacking, people are careless, tools are faulty. Sometimes, goes a twist on the expression, numbers don't lie, liars use numbers. But I think the issue is more fundamental.

Data implies codification, representation, and reduction. Numbers, like I mentioned in the last post, are abstract-- so bogglingly abstract, that when you think about it, our haste to represent the world with them is remarkable. Empiricism, reductionism, and data are a critical part of understanding our world, and I know no good way around them, but I think they are ingrained too deeply, and too rarely questioned by the very people who use them most.

My abstract algebra professor, Dr. Ernie Croot, used a phrase that first amused and then intrigued me: "This is the power of abstract nonsense." That was several months ago, and I've been tossing it around in my head ever since. I kept finding it a more and more packed phrase, even if it was only meant to be casual and comical. It turns out the phrase abstract nonsense was actually coined by mathematicians in the 1940s or so with the emergence of category theory.

My math coursework included only a teasingly brief introduction to category theory, really just enough to know that it's out there and that it adds even more levels of abstraction to what I saw in my abstract algebra courses. From what I understand, category theory generalizes notions including rings (which themselves generalize integers), groups (which generalize mappings and symmetries) and modules (which generalize vector spaces AND rings AND (abelian) groups). Even the least abstract thing just mentioned, the integers, is abstract. They came from what? Our need to count? But could we even conceptualize counting before having integers?

When theories aim to be applicable to everything, are they useful to nothing? The most generalized and abstract theorem I learned in Dr. Croot's class was the Fundamental Theorem of Finitely Generated Modules over Principal Ideal Domains. (Really I just like the name of it and wanted an excuse to mention it!) Now, there are tons of finitely generated modules, over tons of principal ideal domains. And this theorem tells you about any of them. But if you pick a special principal ideal domain, the integers, you get as a corollary the Fundamental Theorem of Finite Abelian Groups, which was pretty much the culmination of an entire previous semester course in group theory. Which is more important, the more general theorem or the corollary?

When I start my graduate studies in economics, instead of math, I don't expect the abstraction (or the nonsense!) to vanish. And while pure mathematicians make no qualms about valuing abstraction qua abstraction, I'm not sure there's such a consensus among economists.

Theories are nets, and we should evaluate them, not as ends in themselves, but for how they concretely change the way we work: for how they allow us to enlarge the ... field, and re-design it in a better way, replacing the old, useless distinctions ... with new temporal, spatial, and morphological distinctions.

Moretti's book comes from the field of literary history, and yet fits into a discussion that started with abstract algebra. (Only thanks to the hyperlinked Web did I ever come near it. I just can't get over the positive feedback between digital networks and knowledge networks.) Anyhow, I hope that in grad school I gain a better understanding of not only how to theorize, but why to theorize.